What Happened After El Salvador Adopted Bitcoin as Legal Currency?

[DEAD7]

What Happened After El Salvador Adopted Bitcoin as Legal Currency?


Chivo launched just after midnight on Sept. 7. The system started failing at three a.m. Server capacity was increased, and app installations were not re-enabled until 11:30 a.m. Transactions failed through the day; customer service lines were jammed; Chivo ATMs ran out of cash. Shortly after ten a.m., the price of bitcoin crashed by $10,000 in three minutes...

After protests on Sept. 6, more than 1,000 people marched on the Legislative Assembly on Sept. 7, jumping barriers placed early that morning to keep them out. One group of protestors set some tires on fire. Opposition politicians attended the day's session in "No Bitcoin" shirts. The protests were not against bitcoin itself. People protested the forced acceptance, the complete lack of transparency from the government, and the dysfunctional Chivo payment system — "people are against how things are being done in the name of bitcoin," local businessman Patrick Murray said....

[T]he Bitcoin Law, and the disastrous launch of Chivo, has frightened the bond markets; El Salvador's sovereign debt dropped almost five cents in a single day, ending Sept. 7 trading at 87.6 cents on the dollar. The World Bank and the International Monetary Fund are already reluctant to supply further funding because of the Bitcoin Law...

Traders were reluctant to accept bitcoin. "I'd rather lose the sale," one trader told La Prensa Grafica. Others didn't trust money they couldn't hold in their hands. Street vendors may not even have phones. Many of their customers are illiterate. Some government offices didn't accept bitcoin payments. Transfers from Chivo to bank accounts were not reliable. The Chivo ATMs didn't work well — one machine had a reported three successful cash withdrawals in a day. Even transfer of bitcoins in and out of Chivo had problems...

 

[TELL ME YA CHEESIN FAM?]

 

[Consigliere]

This never made any sense to me. Crypto hasn’t been adopted on a wide enough level yet for this. All they’ve done is lock the majority of their populace out of their economy.

 

[OfTheCross]

 

[GnauzBookOfRhymes]

Everything is a scam nowadays.

 

[null]

All they’ve done is lock the majority of their populace out of their economy.

how so?

(currency A || bitcoin) > currency A

 

[Mr swag]

Have your country backed by a scam bruhs!

 

[Consigliere]

how so?

(currency A || bitcoin) > currency A

What would happen if your grandparents suddenly had to learn about crypto wallets and exchanges? Would they do it?

 

[null]

What would happen if your grandparents suddenly had to learn about crypto wallets and exchanges? Would they do it?

e-grow, dumb it down as if you were talking to you.

spell it out. what locks people out.

 

[Consigliere]

e-grow, dumb it down as if you were talking to you.

spell it out. what locks people out.

How would that help you when you admit that you’re not as smart as I am? You remedial fukk.

 

[null]

How would that help you when you admit that you’re not as smart as I am? You remedial fukk.

could you dumb that down a bit for me breh? not sure that I follow IYNWIM

 

[Consigliere]

could you dumb that down a bit for me breh? not sure that I follow IYNWIM

So you found another of my posts and negged me? Lol.

You’re a loser. Peace.

 

[Consigliere]

There’s Trouble in El Salvador’s Bitcoin Paradise

Polls have confirmed broad disapproval of the measure, as well as generalized confusion and ignorance about the cryptocurrency’s mechanics. As public anxieties rose ahead of the law’s implementation, negatively impacting Bukele’s much-coveted approval ratings, the president assured the nation that Bitcoin’s usage would not be mandatory. The legislation itself, however, includes mandates that “all economic agents” accept Bitcoin transactions and that preexisting obligations expressed in dollars may be settled with Bitcoin.

 

[Lv99 Slacker]

Let's check in with El Salvador, shall we?



Tourism has gone up by 30% year-to-year at the time this Forbes article was published:

Santander: Security And Bitcoin Boost Tourism Growth In El Salvador | Sept 23, 2023

Santander: Security And Bitcoin Boost Tourism Growth In El Salvador

Santander US Capital Markets published a new report on El Salvador and it shows how bitcoin is impacting its tourism growth.

www.forbes.com

Santander US Capital Markets published a new report on El Salvador. According to this research shared by El Salvador's President Nayib Bukele, the tourism growth the country is experiencing is led by the new level of security that the country is living in and the adoption of bitcoin as a legal tender in 2021.

"The obvious beneficiary of improved security is higher tourism," the report states. Besides not being popular among the Biden administration, the emergency state decreed by Nayib Bukele's government in 2022 is working. There have been 2.3 homicides per 100,000 inhabitants since the beginning of 2023, with a 30% year-to-year surge in tourism arrivals.

For Santander, the potential growth is yet to be discovered. Due to its geographic proximity, the dollarization of its economy, and as BTC tourists' preferred destination, El Salvador is becoming a more common trip for U.S. citizens. Figures are far away from places like the Dominican Republic, which has over 7 million arrivals per year, vs. the 2.1 million arrivals of El Salvador, but the interest is growing faster.

"The number of tourists from the U.S. has doubled on 2019 visitor numbers. Much of that increase can be attributed to bitcoin policy, either directly (i.e., bitcoiners) or indirectly (i.e., those who only heard about El Salvador because of the free marketing by news coverage of it).," said Stacy Herbert, head of the Bitcoin Office of El Salvador, through her X account.

In Bitcoin terms, the interest in the country is vivid. For example, companies like the bitcoin payment processor Strike and the bitcoin rewards app Fold already announced their interest in reallocating or expanding their business in the country. Also, the Bitcoin conference Adopting Bitcoin is experiencing growth. According to one of its co-organizers, Noor Elhuda El Bawab, the conference received 600 attendees in 2021 and up to 1,000 in 2022. The next conference will happen in early November.

Besides the boom in tourism, there's another indicator of the new health of El Salvador society. There's a more vivid interest among the Salvadorean diaspora to return to their country. Santander qualified this as "reverse emigration," pointing out that it could also impact Direct Foreign Investment.

According to a 2022 survey by the International Organization for Migration, 60.2% of Salvadorans are interested in returning to El Salvador at some point, and 18.6% of the population has planned to achieve it.

 

[Lv99 Slacker]

Bitcoin-Touting Bukele’s Bond Rally Draws JPMorgan, Eaton Vance | Aug 15, 2023

Bitcoin-Touting Bukele’s Bond Rally Draws JPMorgan, Eaton Vance

El Salvador President Nayib Bukele scared off many on Wall Street by embracing Bitcoin. Two years later, the bond rally he’s overseeing is proving too lucrative to resist.

www.bloomberg.com

El Salvador President Nayib Bukele scared off many on Wall Street by embracing Bitcoin. Two years later, the bond rally he’s overseeing is proving too lucrative to resist.

Eye-popping 70% returns — the best among dollar bonds from emerging markets this year — are attracting investors who were once cautious or avoiding the securities altogether. JPMorgan Chase & Co, Eaton Vance and PGIM Fixed Income are among those who have recommended or bought the debt, betting it will continue climbing.

The optimism demonstrates how Bukele has gained acceptance from both money managers and his peers in Latin America after many had dismissed him as an anti-establishment maverick. His hard-line stance on gangs, which has dramatically cut crime in the country, is influencing politics throughout the region. And his commitment to paying bondholders is making him a favorite among emerging-market investors.

The country’s bond performances compares to a 6.6% average return across an index of developing nations.

“The story continues to be positive on the fiscal accounts and Bukele has continued to be very consistent in signaling to bondholders that he’s serious about paying the debt,” said Zulfi Ali, a portfolio manager at PGIM.

Besides JPMorgan, Eaton Vance and PGIM, Lord Abbett & Co LLC, Neuberger Berman Group LLC and UBS Group AG have added the debt since April, according to data compiled by Bloomberg.

“El Salvador has benefited from proactive and prudent management of its balance sheet, including a debt buyback during the second half of 2022 and material pension reform,” said Mila Skulkina, a money manager at Lord Abbett.